As building service contractors grow, they’re faced with the ever-increasing challenge of managing their inventories of chemicals, paper and equipment. There are several ways BSCs can keep track of their supplies, and not all of them require a significant investment in technological infrastructure, says Bob Shaunnessey, executive director of the Warehousing Education and Research Council in Oak Brook, Ill.

For instance, BSCs who are less tech-savvy might find vendor-managed inventory (VMI) beneficial.

“With VMI, the vendor retains the title to the inventory, and then just restocks based on the amount you use and projections of what you will use,” Shaunnessey says. “The vendor has all of the tech tools.”

Advantages to the BSC include a simplified reordering process with software handled by the distributor, and the cost of carrying inventory and risk of obsolescence are borne by the vendor, not the BSC. However, contractors still bear the risk of inventory loss due to theft or mismanagement and the cost of the storage facilities themselves; it’s also much harder to switch distributors if they manage your inventory, Shaunnessey cautions.

Self-Managed Inventory
On the other hand, contractors who want to manage their own inventory have several options, Shaunnessey says. First, BSCs will need to choose whether they want to track all of their product centrally — once it leaves the warehouse, it’s considered gone — or at each job step, from warehouse to truck to supply closet to cart.

After that, contractors need to implement a system for tracking their supplies. Small BSCs with simple, centralized inventory can probably get away with a basic spreadsheet or checklist. However, bigger contractors with large warehouses, multiple tracking sites or highly specialized supply lists need more sophisticated software.

“You’ll need a system that keeps track of the amount of the product you use,” Shaunnessey says. “When you’re starting out, you can keep a list of tracking numbers, entered manually, but when you get bigger, you’ll benefit from an automatic ID system.”

One such system is bar coding — managers could put bar codes on each product, pallet or carton, as well as on each shelf or row in a warehouse. Users would scan the product and location as they used the supplies, and computer software would keep track of what is consumed and what needs to be re-ordered.

A similar technology still in its infancy is radio frequency identification (RFID), which puts information into a tag, and RFID scanners can read the tag from a distance. Right now, this technology isn’t being used as often as bar coding in the jan/san industry, especially among end users, as the costs of scanners, tags, software and training have not yet come down. But, Shaunnessey believes BSCs and their distributors can find a use for RFID on their larger equipment, such as scrubbers and vacuums.

“Asset management is a good application,” he says. Applying RFID tags to individual items, such as spray bottles or tissue rolls, is probably cost-prohibitive, but on durable machinery costing thousands of dollars, the estimated 30 cents per tag is negligible.

In all, a good inventory-management system can help BSCs keep track of their supplies, reduce shrinkage and promote efficient use of labor and storage space, regardless of cost or technology.




POSTED ON: 9/1/2005